The Toronto Stock Exchange plunged lower on Wednesday afternoon, erasing earlier gains as financial stocks tumbled.

The S&P/TSX composite index dropped 143.74 points, or 1.4%, to end at 10,142.16.

The financials group gave back a chunk of the gains it registered on Tuesday, falling 2.9% during Wednesday’s trading.

Shares of Laurentian Bank of Canada dropped 5% after it reported quarterly earnings of $21.2 million, down from $25.1 million a year earlier. The bank’s shares fell $1.53 to $29.22.

Bank of Montreal shares dropped a sharp 4.4% one day after they rallied on news that the bank earned profits of $358 million in its second fiscal quarter. BMO shares shed $1.92 to close at $41.79.

Shares of Manulife Financial Corp. fell 3.8% to $22.25 and Toronto-Dominion Bank’s stock declined 3.3% to $50.28.

Royal Bank of Canada slipped $1.05, or 2.3%, to $44.00.

Materials stocks dropped 1.7% on Wednesday, while the sub-gold index fell 1.9%, though gold futures remained unchanged. On the Comex division of the New York Mercantile Exchange, gold for June delivery ended at US$953.30 an ounce.

Shares of Barrick Gold Corp. plummeted 2.5% to $40.17 and First Quantum Minerals Ltd. fell $2.00, or 4.1%, to $47.00.

Also lower was Potash Corp., down 3.5% to $126.30, and Agrium Inc., down 2.4% to $55.87.

The energy group managed to edge up 0.1% on Wednesday, as oil futures finished at their highest level since early November. Crude for July delivery closed up US$1.00, or 1.6%, at US$63.45 a barrel on the New York Mercantile Exchange.

Suncor Energy Inc. gained 1.3% to $37.11 and Petro-Canada rose 1.3% to $46.26.

Units of Canadian Oil Sands Trust rose 1.8% to $26.65.

Lower for the day was Canadian Natural Resources Ltd., down 1% to $61.75, and Baytex Energy Trust, down 2.7% to $18.61.

Meanwhile, junior companies on the TSX Venture Exchange also declined on Wednesday, sending the Venture composite index down 4.17 points, or 0.4%, to 1,092.99.

The Canadian dollar shed US0.13¢ to close at US89.33¢.

Stocks south of the border also finished with hefty losses on Wednesday on concerns that automaker General Motors Corp. could file for bankruptcy.

The Dow Jones industrial average dropped 173.47 points, or 2.1%, to end at 8,300.02.

The S&P 500 index fell 17.27 points, or 1.9%, to close at 893.06.

The Nasdaq composite index dipped 19.35 points, or 1.1%, to end at 1,731.08.

Shares of General Motors Corp. tumbled 20.1% after the company announced that bondholders had rejected its offer to exchange US$27 billion in unsecured debt for 10% of the company’s stock, indicating that a bankruptcy filing is likely. GM shares fell US$0.29 to finish at US$1.15 on the New York Stock Exchange.

IE